Ohio School Employees Union Files Lawsuit Against Retirement System

Close to 200 members of the Ohio Association of Public School Employees protested pension cuts in June 2017.

Jo Ingles
/ Statehouse News Bureau

The Ohio Association of Public School Employees has filed a lawsuit to block a three-year cost of living freeze to retirement benefits.

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The School Employees Retirement System (SERS) voted in October to impose the freeze to "address immediate financial challenges and long-term funding goals." That means retirement allowances will not increase to adjust for inflation.

The union, which represents non-teaching school employees like school-bus drivers, secretaries and janitors, says the freeze would impact about 80,000 retirees. Union public affairs director Kathy Malone says it's set to take effect March 23.

“Our members are typically some of the lowest-paid workers in Ohio. They are school secretaries, bus drivers, mechanics, librarians, custodians,” Malone says. “And on average they make about $24,000 dollars a year and they retire with pensions of about $12,000 dollars a month.”

The lawsuit, which was filed in the Franklin County Common Pleas Court, says the retirement system made poor investment choices and made lavish payments to internal investment consultants and external financial managers.

“We've been talking to SERS over the years about alternative options so that our members wouldn't be impacted by this,” Malone says. “But they voted for this freeze and we felt the only option we had to fight for our members was to file the suit.”

SERS spokesperson Tim Barbour says the group learned about the lawsuit this morning.

“We don't have too much to say about it, except we believe the actions taken by SERS were legal and prudent given the circumstances,” Barbour says.

About 200 members of the union marched in front of the Ohio Statehouse in June to protest pension cuts.

State pension systems are underfunded by more than a trillion dollars nationwide, according to a new report from the Pew Charitable Trusts. Taxpayers would have to make up that shortfall. But the study has some good news for Ohio.

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